Décamps, Jean Paul; Gryglewicz, Sebastian; Morellec, Erwan - C.E.P.R. Discussion Papers - 2015
We develop a dynamic model of investment, cash holdings, financing, and risk management policies in which firms face … financing frictions and are subject to permanent and temporary cash flow shocks. In this model, target cash holdings depend on … the long-term prospects of the firm, implying that the payout policy of the firm, its financing policy, and its cash …